In a move set to reshape the landscape for small and medium-sized enterprises (SMEs) in Egypt, Fawry, a pioneer in electronic payments and banking technology, has entered into a strategic cooperation agreement with Hulul, backed by WideBot, the leading Arabic-focused conversational AI chatbot building platform in the MENA region.
Under this groundbreaking collaboration, Fawry will integrate its cutting-edge electronic payment systems with Hulul’s services, leveraging AI-driven chatbots to catalyze digital transformation for SMEs. The aim is to empower emerging institutions, particularly small and medium-sized businesses, by providing them with innovative fintech services. This strategic move is poised to fortify their positions within the Egyptian market.
The core of this collaboration lies in Fawry’s commitment to furnish Hulul’s network of SMEs with the latest in fintech innovation. Through an automated chat feature relying on AI, Fawry will create a seamless payment link, facilitating secure electronic transactions. This initiative is anticipated to expedite the digital transformation journey for these enterprises, bolstering their competitiveness and operational efficiency.
The collaboration seeks to combine Fawry’s expertise in payment solutions with Hulul’s advanced AI-driven digital transformation services. This partnership aspires to revolutionize SME operations in the digital realm, offering them comprehensive tools to drive growth, enhance efficiency, and elevate customer experiences.
Hulul, a subsidiary of WideBot Artificial Intelligence, has positioned itself as a critical player in supporting SMEs to navigate the complexities of digital transformation. With an impressive customer base of 35,000 and having processed over a billion messages, Hulul’s services reach more than 60 million customers in over 40 countries. The platform boasts a market presence that spans 20 regional and global partners.
Heba El-Awady, Chief Business Officer at Fawry, expressed the company’s commitment to fostering startups and small businesses across various industries. She emphasized the provision of innovative payment technology services aimed at propelling growth, aligning with the dynamic entrepreneurial landscape in Egypt, and ultimately contributing to the advancement of the Egyptian economy.
Mohamed Nabil, CEO and co-founder of WideBot, expressed pride in the collaboration with Fawry, highlighting their joint efforts to usher in comprehensive changes to the business flow systems of small, medium, and emerging companies. Nabil emphasized the innovative combination of the latest financial technology and artificial intelligence tools, designed to offer an unparalleled experience through secure and innovative services and solutions.
This strategic partnership between Fawry, Hulul, and WideBot is poised to reshape the digital landscape for SMEs, driving economic growth and innovation within the Egyptian market.
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard.
To improve digital payment services and increase the capabilities of the Orange Cash wallet, Orange Egypt and Fawry, Egypt’s top supplier of e-payments and digital finance solutions, have entered a collaboration agreement.
The partnership reinforces Orange Cash’s position as Egypt’s top digital payment provider by offering consumers a complete money management solution that fully satisfies their demands on a platform that is dependable, secure, and compatible to all applicable laws and regulations.Money transfer, electricity, water, and gas bills, insurance premiums, union payments, clubs, schools, and universities, donations, ticket purchases, traffic fines, online purchases, real estate installments, bank loan settlement and merchant payments are just a few of the many services offered by Orange Cash.
Fawry is always seeking to establish strong strategic partnerships with significant businesses and organisations that offer e-payment services through their smart wallets. In order to support the initiatives of the Central Bank of Egypt and stay up with the digital transformation to reach a cashless society, As Fawry owns the most sophisticated systems for developing and administering e-wallets as well as the most cutting-edge and secure fintech technologies.
Through the expansion of current services and the introduction of new ones while maintaining compliance with all rules and regulations established by the Central Bank of Egypt, this cooperation strengthens Orange Cash’s position as a provider of customer care.
On this occasion, Yasser Shaker, CEO at Orange Egypt said: “Today’s partnership with Fawry reaffirms the company’s strategy and commitment to accelerate financial inclusion and help turn the economy into a cashless one while ensuring that all payment needs of Egyptians are met through a comprehensive platform in cooperation with prominent local partner in this sector. Following our recent partnership with the National Bank of Egypt, this new partnership with Fawry combined with Orange’s worldwide expertise in mobile money and digital banking makes Orange Cash the strongest mobile wallet solution of Egypt with the strongest partners of the sector.”
He added: “Orange Cash provides now its customers with unprecedented digital payment capabilities in the field of e-wallets in Egypt, in a way that allows its customers to benefit from the latest global trends in this sector in a faster, safer, and more efficient way”.
Eng. Ashraf Sabry, CEO of Fawry, stated: “In response to the state’s tendency to increasingly rely on e-payment solutions in financial transactions, which has become absolutely necessary in recent years to keep up with digital transformation, Fawry has made significant investments, allowing it to serve as the strategic partner for digital transformation services as well as the development and management of mobile wallet platforms. We are pleased that all of the services and solutions offered by Fawry were created by Egyptians”.
“In order to give customers a unique, secure, and efficient experience, our partnership with Orange will greatly accelerate the development of e-payment solutions in Egypt through the widespread use of digital solutions”, he added.
By leveraging a range of electronic payment channels and techniques for all transactions and daily activities, Fawry is committed to developing an e-payment culture throughout Egyptian society, according to Sabry. This was consistent with Egypt’s Vision 2030, which aims to develop the financial industry, support and enhance digital operations, and attract new client groups to promote financial inclusion.
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard
Fawry, the leading company in digital transformation and electronic payments, has announced a partnership with “Shahid,” a foremost Video on Demand (VOD) streaming platform in the Middle East and North Africa (MENA) region, to offer digital payment options for their new VIP mobile package in Egypt. The partnership will allow Fawry to offer digital payment options for their new VIP mobile package in Egypt.
Heba El Awady, Chief Business Officer-Acceptance at Fawry
This partnership is one of the steps that Fawry is taking to strengthen its host of services that it provides to its customers. Additionally, this partnership falls in line with Fawry’s pursuit to forge an effective series of agreements and partnerships with various entertainment streaming platforms.
Shahid, a streaming service, has made its VIP package accessible on smart phones in Egypt. This enables Shahid customers to experience Shahid originals and a huge and varied catalogue of entertainment content, ranging from series to movies and LIVE channels, whenever and wherever they choose.
Users who are interested in subscribing to the VIP mobile package can do so by making a payment of 20 Egyptian Pounds (EGP) using any one of Fawry’s many payment options, such as the myFawry app, any of the FawryPlus locations located around Egypt, or Fawry’s point of sale terminals.
Heba El Awady, Chief Business Officer-Acceptance at Fawry, said: “With the recent uptick in subscribers of digital platforms and entertainment streaming services, Fawry had to follow a strategy, where it forges a series of effective agreements and partnerships with the entertainment streaming services, which gives us a new segment of users, thus we are proud of our partnerships with Shahid, the world’s leading Arabic streaming platform. We aim to offer a unique and rich experience to their customers, with special content.”
Scott Weeman, Head of B2B & Partnership at Shahid, added: “We are delighted to expand our partnership with Fawry, a leader in digital transformation and electronic payments in Egypt, with a large user base and extensive payment facilities. We are excited about the appeal of VIP Mobile for Fawry users, as we aim to make Shahid’s premium content available to a broader segment of Egyptian consumers through easy and smooth payment methods”.
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexperts.com/view_expert/charles-rapulu-udoh
Fawry, Egypt’s top e-payments and banking services provider, has announced today that the total value of loans given by its subsidiary Fawry Microfinance had crossed EGP 1 billion ($63.6 million) since its start. Fawry Microfinance was founded in 2018 to give small businesses and entrepreneurs in Egypt with financial solutions that are both accessible and affordable, leveraging an end-to-end digital infrastructure to dispense loans and collect payments. The efforts of Fawry Microfinance have made a significant contribution to the national goals of financial inclusion and financial service digitization.
Fawry CEO Eng. Ashraf Sabry.
“The benefits of financial inclusion are growing clearer by the day,” said Fawry CEO Eng. Ashraf Sabry. “Access to affordable financial services allows small- and medium-sized businesses, which employ the majority of Egypt’s labor force, to expand and invest, creating employment and powering inclusive economic growth. We at Fawry Microfinance are proud of our track record in creating tangible opportunities for entrepreneurs and families, allowing them to invest in their futures and promoting the government’s efforts to achieve sustainable growth by expanding marginalized groups’ access to financial services.”
Here Is What You Need To Know
Despite the lingering impacts of the COVID-19 pandemic on the Egyptian and worldwide economies, such as supply chain disruptions and heightened inflation, Fawry Microfinance’s portfolio grew rapidly in 2021.
As of December 31, 2021, Fawry Microfinance had an outstanding portfolio of EGP 437 million, up 67 percent over the EGP 267 million booked at the end of 2020. At the end of 2021, the subsidiary had a 98.5 percent collection rate.
With almost 40% of Fawry Microfinance’s clients under the age of 30, the subsidiary’s operations demonstrate Fawry’s dedication to the principles of sustainability and reaching the national goal of financial inclusion. In addition to boosting employment, extending accessible funding to young entrepreneurs aids in the creation of new economic prospects and the optimal usage of Egypt’s human capital resources.
Meanwhile, Fawry supports the Egyptian Central Bank’s goal of increasing financial inclusion and financial awareness in rural areas. Fawry Microfinance’s services are not limited to Egypt’s main cities. The subsidiary’s services are offered in 25 of Egypt’s 27 governorates, covering a large portion of the country’s rural and economically disadvantaged communities.
The majority of Fawry Microfinance’s 33 thousand clients were involved in retail trade as of year-end 2021, with other clients involved in simple service supply. Nearly 60% of clients were previous Fawry customers who had been introduced into the Company’s merchant network via Fawry POS equipment. The Company’s membership in the Fawry network enables it to simply deliver a variety of services to these clients, ranging from omnichannel acceptance to the establishment of e-commerce platforms.
A Look At What Fawry for Banking and Payment Technology Services Does
Founded in 2008, Fawry is the largest e-payment platform in Egypt serving the banked and unbanked population. Fawry’s primary services include enabling electronic bill payments, mobile top-ups and provisions for millions of Egyptian users. Other digital services also include e-ticketing, cable TV, and variety of other services. Through its peer-to-peer model, Fawry is enabling corporates and SMEs to accept electronic payments through a number of platforms including websites, mobile phones, and POSs. With a network of 36 member banks, its mobile platform and more than 250,000 agents, Fawry processes an average of 3 million transactions per day, serving an estimated customer base of 35 million users monthly.
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions. He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance. He is also an award-winning writer
Fawry for Banking and Payment Technology Services S.A.E. (the “Company,” FWRY.CA on the Egyptian Exchange) announced today that it intends to seek EGP 800 million ($50.8m) in expansion capital via a rights offer to current shareholders. The funds will be used to launch a new era of financial service growth for both consumers and merchants. The offering will assist place the Company at the forefront of Egypt’s Super App opportunity, in addition to expanding the Company’s products on MyFawry. Furthermore, the company will continue to invest in improving its merchant acquiring and supply chain solutions positions. The Company’s board of directors also approved the formation of an American Depositary Shares (“ADS”) program, and the company is looking into a possible SEC-registered secondary offering in the United States. The proposed offering’s timing, amount of ADSs, and price have yet to be established.
The proposed offering is subject to market circumstances, shareholder and regulatory approvals, and no assurance can be given as to whether or when the offering will be completed, or as to the size or terms of the offering.
A portion of the fundraising proceeds will be used to carry out the Company’s investment strategy, accelerate innovation, and support the burgeoning ecosystem of high-growth startups and fintech that complement Fawry’s offering through e-commerce, logistics, fintech services, and insuretech, among other verticals.
The Company’s board of directors, which includes directors who represent the company’s major shareholders (whether institutional investors or financial institutions), has approved the proposal to raise capital to fund the company’s growth plans if the necessary shareholder and regulatory approvals are obtained.
Fawry CEO: Ashraf Sabry. Image credits: Fawry
A Look At What Fawry Does
Fawry is Egypt’s largest digital transaction and e-payment platform, serving both the banked and unbanked. The Company, which was founded in 2008, provides consumers and businesses with ways to pay bills and other financial services, such as payment getaway, e-commerce solutions, and/or microfinance solutions, through more than 250,000 agents and a variety of channels, such as online, ATMs, mobile wallets, and retail points of sale.
The Company’s peer-to-peer model enables companies of all sizes to accept electronic payments, as well as customers to make payments to merchants in the Company’s network in a convenient and secure manner. Merchants in the telecom, education, healthcare, grocery, stationary, and postage industries are among the Company’s nationwide network of merchants. The Company is able to conduct an average of three million transactions each day, serving an estimated customer base of thirty-five million users per month, thanks to a network of over thirty-five partner banks and a large member network.
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions. He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance. He is also an award-winning writer
Fawry (the “Company”, FWRY.CA on the Egyptian Exchange), Egypt’s leading e- payments solutions and banking services provider, has announced plans for establishing a consumer finance company, Fawry Consumer Finance, broadening its existing offering of financial solutions as a service currently offered through partner banks and financial service providers. This aims to expand the targeted consumer categories providing more options at check out and cementing Fawry’s position as a platform for financial services that empowers consumers with a broad range of payment choices. The move also comes in line with the government vision & FRA strategy to support financial inclusion & digital transformation.
AbdelMeguid Afifi is the CFO of Fawry . Credits: Fawry
The company will offer its customers convenient access to credit through multiple products including Buy Now Pay Later “BNPL”. This comes in line with the company’s strategy to add more financial services across its channels and expand its direct-to-consumer offering. As always with Fawry, the move is aimed to unlock opportunity on both the consumer and merchant side leveraging its dual sided network. Through providing BNPL at checkout Fawry enables its merchants to grow sales and enhances its acceptance offering.
In that regard, AbdelMeguid Afifi, CFO of Fawry, said, “We know consumers are looking for frictionless experiences at check out and flexibility in payment offerings. In the last couple of years we’ve seen huge growth of buy-now-pay- later transactions. We also believe that providing value added services at checkout for the merchant will be key to growing our acceptance business and deepen the utilization of our POS network.”
“The offering combines the two, allowing Fawry to meet real needs of consumers to gain access to credit and empowering merchants to offer their customers multiple options to pay on their own terms,” Afifi added.
Fawry Consumer Finance was established with an initial capital of EGP 10 million, and is fully owned by Fawry and its subsidiaries. Fawry recently received the necessary license from the Financial Regulatory Authority (FRA), and is looking to directly offer its customers consumer finance in 2022.
Fawry consumer finance company Fawry consumer finance company
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions. He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance. He is also an award-winning writer
Fawry, an Egypt-based FinTech and E-payment solutions provider, is now undoubtedly on a journey to invest in startups both in Egypt and internationally across several industries. Following investments in tech-enabled delivery platform Bosta last year, fast-growing F&B platform Elmenus early this year, and most recently in Brimore, a social commerce marketplace, the company’s next stop is Sudan, where it has led a $5 million funding round in alsoug.com, Sudan’s largest online classifieds platform and marketplace.
“This investment marks a significant milestone not just for alsoug, but for the nascent tech space in Sudan as a whole, which has until today been essentially shut out of the global capital markets. I hope this investment is the first of many and that the huge potential of the tech sector in Sudan is fully realized in the coming years. We are looking forward to working with Fawry, and our new strategic shareholders, to continue our expansion from the classifieds and marketplace space into payments. We will build a payments platform that will deliver financial inclusion to all Sudanese,” Alsoug co-founder and CEO Tarneem (Nina) Saeed said.
The investment will help build out alsoug’s new fintech platform, Cashi.
Why Fawry Invested
This is Sudan’s first venture capital funding round. The presence of Fawry catalyzed participation from other major Western VC players, assuring the success of the USD 5 million round. As a strategic investor in alsoug, Fawry plans to use its extensive experience with white label technology solutions to help the platform scale up by improving its merchant acquisition operation, refining its go-to-market strategy, and providing valuable insights that inform high-level strategy across all business segments.
“We’re delighted to be kicking off our partnership with alsoug, one of Sudan’s most exciting prospects and a Sudanese leader in tech innovation. This is our first investment foray outside of Egypt in our thirteen years of operation, and we’re confident that our story with alsoug and Cashi will be a special one. Fawry’s investment in alsoug delivers on our plans to venture into underserved international markets by leveraging our technology and teaming up with strong local players. This investment will provide us the opportunity to strategically expand our footprint into Africa and transfer the experience we’ve gained in the dynamic Egyptian market to neighboring Sudan, an economy with major potential across several sectors and with a significant pool of entrepreneurial talent. Meanwhile, Fawry’s strategic partnership with alsoug leaves it ideally placed to help guide the platform’s rollout of a countrywide payments system, a feat which Fawry has already managed through a scalable, robust, and best-in-class technology platform,” Fawry CEO Eng. Ashraf Sabry said.
Ashraf Sabry is the CEO of Fawry. Source: Fawry
Fawry, Egypt’s largest e-payments platform, was founded in 2008 to serve the country’s banked and unbanked communities. Fawry’s main services include electronic bill payment, mobile top-ups, and provisioning for millions of Egyptians. E-ticketing, cable TV, and a variety of other digital services are also available. Fawry’s peer-to-peer concept allows businesses and SMEs to take electronic payments using a variety of channels, including websites, mobile phones, and point-of-sale terminals.
A Look At What asloug Does
Alsoug, Sudan’s leading consumer internet platform and largest digital marketplace, was founded in 2016 by a world-class team of technology entrepreneurs. Alsoug, a platform where sellers may post everything from real estate and vehicles to services and commodities, is one of Sudan’s most popular apps on the Google Play app store, with two million downloads.
Despite the political and economic challenges facing Sudan as it undergoes a transformative political transition, the platform has grown rapidly since 2016, owing to alsoug’s highly skilled in-house developers, extensive coverage by its on-the-ground teams, and Sudan’s promising economic fundamentals. Alsoug will considerably increase its service offering in the future, establishing a new payments network capable of serving consumers across Sudan, one of the largest countries on the African continent, and building on its strategic cooperation with Fawry.
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions. He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance. He is also an award-winning writer
Fawry, an Egypt-based FinTech and E-payment solutions provider, appears to be on a journey to invest in all Egyptian startups across different industries. After the company invested in the tech-enabled delivery platform Bosta last year and early this year in the fast-growing F&B platform Elmenus, it has returned to purchase minority shares valued at $1m in Brimore, a social commerce marketplace.
Fawry CEO Eng. Ashraf Sabry
“Fawry’s investment in Brimore represents an important vote of confidence in the company and its business model, which reaffirms our belief in the transformative power of digital tools to revolutionize commerce in Egypt. Our platform has enabled tens of thousands of individuals across Egypt to start and grow profitable businesses with zero initial investment,” Brimore Co-Founder and CEO Mohamed Abdulaziz said.
Why The Acquisition
“We look forward with great anticipation to our journey with Brimore. The company’s business holds great promise for spurring inclusive economic growth, where greater access to financial and business services enables small and micro enterprises to play a bigger role in the economy. Our more than 230,000 strong merchant network is just one of the areas where lasting value will be created through this partnership,” Fawry CEO Eng. Ashraf Sabry said.
By investing in tech-innovative firms across Egypt, Fawry management has found many potential to encourage synergies and create integrative prospects. Last year,
Fawry wants to integrate its payments and financial services products seamlessly into the Brimore platform, with additional collaboration planned with Fawry’s complementary verticals in the commerce and FMCG industries.
A Look At Both Companies
Fawry, which was founded in 2008, provides financial services to individuals and businesses through a range of channels, including the internet, ATMs, mobile wallets, and retail locations. Collection services, client acquisition, electronic cash, payment facilitation, and B2B collection centers are among Fawry’s commercial offerings. This investment will create a new synergy between the two firms, as Fawry uses its position as a strategic investor in Brimore to engage, assist, and drive growth at the company as well as in Egypt’s larger digital ecosystem.
Brimore’s social commerce platform connects small and medium-sized manufacturers to a huge network of freelancing community distributors who sell and endorse products in their local communities. It was founded in 2017 by supply chain veterans Mohamed Abdulaziz and Ahmed Sheikha Brimore. The Cairo-based team assists producers in avoiding costly in-house production and distribution expenses, as well as minimizing their dependency on inefficient traditional distribution networks. SME manufacturers of primarily unbranded items get unparalleled market access through Brimore, allowing them to compete on a more level playing field with established industry giants.
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions. He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance. He is also an award-winning writer
Fawry, an Egyptian fintech firm, has been named the number one Fintech App in the Middle East by Forbes. Myfawry has 3.5 million total downloads and $105 million in annualized throughput as of June 2021. The Forbes report also highlighted the best mobile apps for making payments, transferring money, borrowing money, and even investing money online. These features are already available on myfawry, which pioneered the technology in Egypt and now offers a variety of other services such as paying mobile bills, booking bus tickets, and more.
Engineer Ashraf Sabry, CEO of Fawry
“We are pleased to know that myfawry is the number 1 fintech app in the region and we are proud with what Fawry has achieved not only in Egypt but in the entire Middle East in terms of electronic payments,” said Engineer Ashraf Sabry, CEO of “Fawry”. “We are continually striving to further expand our services and to cover more countries not only in the Middle East but the rest of the world, achieving progress that will make a fundamental change in the field of digital payments,” he added.
As Egypt observed the swift adoption of electronic payments, Fawry recognized the opportunity to establish myfawry that would be accessible across the country and on every device. This is in keeping with the objective of the Egyptian government to push for digital transformation as it becomes one of the fastest expanding markets in the Middle East.
Fawry was listed on the Egyptian Stock Exchange in 2019, and as of August 2021, it had a market capitalization of $1.9 billion. The company’s net profit increased to $1.5 million in the first half of the year.
In addition, Fawry’s revenue increased to 742.5 million pounds during the same period, up from 549.2 million pounds the previous year.
Fawry was founded in 2007 as an idea by Ashraf Sabry, a technology industry expert who envisioned an easy-to-use and accessible electronic payment in the Egyptian market. It began with 5,000 service points in only two cities and has since grown to 225,000 service locations around the country, providing over 1,186 services. This has made Fawry the preferred electronic payment service for over 29.3 million customers who conduct over 3.069 million daily financial transactions such as payments, collections, settlements, contracts, and new subscriptions.
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions. He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance. He is also an award-winning writer
August, 2019. An eleven year old fintech company, Fawry, was about to do the unthinkable. Its headquarters in Cairo, Egypt was just a stone’s throw (3 minutes away) from The Egyptian Exchange, the country’s stock exchange where shares and other securities of companies are bought and sold, publicly. Everything had been planned out, and barring any last minute changes, the company founded by a fifty-something-year-old man who quit his job at the peak of his career, would be going on a major exit through Initial Public Offering (IPO) on the exchange. This would be some overwhelming moments for investors —the Egyptian-American Enterprise Fund (EAEF), the pan-African private investment firm Helios Investment Partners, and the International Finance Corporation — who had acquired a majority stake in the company far back in 2015. It would also be some exciting moments for the company’s management and employees who owned 8% of its shares. Exciting because, if the company’s shares on offer were sold at EGP 6.46 per share as it had been planned, they would, most likely, become overnight millionaires.
Ashraf Sabry is the founder and CEO of Fawry. Image credits: Fawry
But the unexpected happened, instead, when the exchange opened for trading that day: Fawry’s share price soared 31 percent higher than the planned IPO price, to close at EGP 8.48 on the first day of trading.
Reports would later come in that the IPO had been oversubscribed by 30 times.
And as though that was not enough, barely a year after in 2020, at the heart of the coronavirus pandemic, Fawry became a unicorn — a golden billion dollar company, aided by a further rise in the company’s price per share, to EGP 22.69.
Now, here are the quick takes:
Fawry’s listing was the first IPO of that year and so the thirst was understandable; but perhaps knowing that the feat was uncommon makes it even more interesting:
In 2008, when Fawry was founded, there was no single technology company listed on The Egyptian Exchange. In fact, so devastated was the exchange that its 30 most active stocks incurred 56% losses that year.
And to make matters worse, the financial services sector (excluding banks) which Fawry could have, at least, laid claims to saw a major decline of 64% in trading activities, one of the highest in years.
And so, judging by the company’s IPO success, this was a big win for early investors who threw their weight behind Fawry against the odds, as well as huge sighs of relief for founders, Ashraf Sabry and Mohamed Okasha.
“In 2008, I left my job and had limited time to convince investors that customers would trust paying their bills electronically at a grocery store. The challenge was establishing the company before my financial resources got depleted,” CEO and co-founder, Ashraf Sabry, said in an interview.
“Overcoming the challenge needed a thorough understanding of the business model, sharing experiences in other markets, committing to invest 80% of my personal financial resources in the same project and, finally, not giving up quickly. [This also involved] … trying to find new investors all the time,” he added.
“The second challenge was convincing the first biller to join the network; I still remember, it was Vodafone,” he said. “The problem was that Vodafone had to allocate resources to develop the integration with their systems and had to introduce a new competitor to their valuable distribution network. So many of the stakeholders resisted the idea.”
“I think I managed to overcome [that] … challenge by deciding to carry the cost of the implementation, to find a champion within Vodafone to support me, [putting together an] … appealing commercial deal and, most importantly, never giving up,” he further said.
“Other challenges include being almost bankrupt after three years, as well as attracting and retaining good people. I think the one factor in overcoming all challenges is, never give up and be persistent,” he concluded.
The Egyptian Exchange And Tech Startups
Going on IPO on The Egyptian Exchange, which has two branches across the country— one in Cairo and another in Alexandria — is not complicated at least for non-Arabic-speaking investors and companies.
A company may list on the exchange, either through the main board or the SME board.
The major difference between the two lies in the paid up capital requirements. That is, while a company listed on the main board is required to have not less than 100 million Egyptian pounds ($6.4m), a company listed on the SME board can have less.
A company listed on the main board is also required to have a financial history (written purely in Arabic) of not less than three years.
It is also required to offer not less than 5 million of its shares ( which must represent not less than 25% of the total shares of the company) for public sale.
The company must not also be worth less than 200 million Egyptian pounds ($12.8m).
For its part, a company listed on the SME board must have been in existence for at least two years, and must engage a contractor registered with the exchange which shall assist it to list its shares for purposes of trading.
In addition to having less than 100 million Egyptian pounds ($6.4m) paid up capital, the SME must also ensure that not less than 1 million pounds is fully paid up.
The company must also offer not less than 100 thousand shares for public subscription, which shall not be less than 25% of the company’s shares.
Furthermore, at all times, the company’s net worth must not exceed 200 million Egyptian pounds ($12.8m).
And so, it was easier for Fawry. After 11 years in operation, it had the metrics: it had received a valuation of EGP773 million (US$100 million) following investments made by the investors in 2015. It had made core profit of 152 million pounds ($9.8m) in 2018, up 41.2% on the previous year. Its network had also processed 600.1 million transactions in 2018 alone with a total value of 34.2 billion Egyptian pounds ($2.1 billion).
But for startups who don’t have these metrics, IPOs are still a long shot from reality.
“So far, I don’t think that Egypt Exchange can offer an exit opportunity for Egyptian tech startups, even if we’re offering exchange for small to medium size stocks called NILEX EXCHANGE,” Soliman S. AlTayyar, an Egypt-based capital markets and investment expert told Afrikan Heroes.
“This is because investors’ mentality won’t digest such companies at early stages…Therefore, venture capital (VC) funds are the best way to fund these “startups” until acquisitions or other exit routes, including IPOs,” he said.
IPOs on The Egyptian Exchange, for the years 2017, 2018, 2019. Source: The Egyptian Exchange
International Investors Are Interested In Egypt’s IPOs
The greatest insights into the depth of investors’ interests in Egyptian tech stocks are not in the figures trailing Fawry’s performance on the stock exchange.
The greatest insights, and the key to understanding the future of startup exits through IPOs on The Egyptian Exchange lie in the investors’ demographics.
Of the investors who participated in Fawry’s public listing, Egyptians represented 80.3% of the IPO and 50% of the private placement; while Arabs and Foreigners represented 19.7% of the IPO and 49.3 of the private.
This was expected; while the private placement was done by a foreign firm -Netherland Holding BV — the IPO was local and closer to Egyptians via the exchange.
But what is even more intriguing is the demographics of the participants in all the four IPOs that held on The Egyptian Exchange in 2019.
Valued at EGP 5.14 billion (compared to EGP 5.2 billion in 2018), the four IPOs saw 67.36% participation of foreigners, and only 32.64% of Egyptians, although Egyptians dominated total annual transaction deals (67.06% to 32.94%).
Overall, while investors from the United Kingdom accounted for 30.09percent of total foreigner transactions in 2019, the United States of America, Luxembourg, and the Kingdom of Saudi Arabia, each had a share of 13.28 percent, 10.98 percent, and 7.17 percent, respectively.
The Space For Tech Companies Is Still Small On The Egyptian Exchange
Compared to other sectors, there are currently only about six companies classified as tech on the Egyptian Exchange, out of over 220 companies listed on the exchange. And out of the six, only Fawry may rightly be classified as a digital company in the true sense of the word.
However, even though there are only a few tech companies listed on the platform, they have outperformed other sectors in terms of trading volume.
For instance, the total trading value of the shares of tech companies listed on the exchange amounted to 3.7 billion Egyptian pounds in the first quarter of 2021, compared to 5.6 billion Egyptian pounds which accrued to listed banks, even though there are 14 banks currently listed on the exchange.
Breakdown of market capitalization on The Egyptian Exchange, March 31, 2021. Source: The Egyptian Exchange
What Do Sarwa Capital And Fawry’s IPOs Mean For Egyptian Tech Startups Desiring To Exit Through IPOs On The Egyptian Exchange?
It is interesting to note that apart from Fawry, Sarwa Capital’s initial public offering (IPO) was oversubscribed 30.1 times in 2018.
In fact, apart also from Fawry, Sarwa Capital recorded the biggest IPO in The Egyptian Exchange’s two year history (2018–2019).
The company raised $13.9m through IPO and $121 million through private placement.
Sarwa is anonline investment platform owned by Egyptian American Enterprise Fund “EAEF’’.
Although fraught with allegations of fraud and described as failed, Sarwa’s IPO together with Fawry’s could be said to be the closest representation of what tech startup IPOs in Egypt could look like, all things being equal.
However, while it could be said that investors’ interests in Egyptian tech stocks could be seen more in Fawry’s IPO, the interests particularly became clear and defined following the outbreak of the coronavirus pandemic.
The first day of trading in 2019 put Fawry’s market capitalisation at EGP 6 billion or $366 million.
But investors’ interests swung unsteadily thereafter, including dipping to the lowest of 7 Egyptian pounds per share in March 2020, before surging by over 300 percent resulting in a cap of EGP 16 billion or $1 billion or unicorn status (for the first time).
“FAWRY is…the only fintech company in the Egyptian stock market aligned with Egypt’s vision towards a cashless society,” Soliman said.
“The company’s stock performance, especially the increase in its price per share from IPO price EGP ~6/ share to current EGP ~40/share was aided by a number of factors. First, Egypt’s digital payments to GDP is 3% and government is aiming to increase this to 10% in 2–3 years. Second, the coronavirus pandemic now also accelerates the pace of digitization, especially the adoption of e-payments,” he said.
“Similar fintech companies could find an opportunity to list on the exchange, but similar record-setting performance of FAWRY is not guaranteed,” he said.
“If similar companies to FAWRY tried to list today, they may not perform like FAWRY because competitive landscapes change a lot…But still, IPO could be a way to go,” he concluded.
NB: 1 Egyptian Pound equals 0,064 United States Dollar, as at 11th May, 2021
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions. He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance. He is also an award-winning writer
